Amazon re-announces $7.5 billion data centre investment in NZ

Tuesday, 2 September 2025

This morning’s announcement by Christopher Luxon used AWS promises that had already been made four years ago.

Christopher Luxon’s detailing of a $7.5 billion investment in New Zealand by Amazon Web Services, and the possible creation of 1000 jobs from it, was already announced by the company in 2021.

Four years ago, Amazon Web Services said it would base cloud computing data centres in Auckland because of the city’s telecommunications connections and skilled workforce, and would spend “$7.5 billion over 15 years building world class computing infrastructure” in Auckland.

This is the same as what was announced this morning, although Amazon vowed at that time to build “a cluster” of at least three data centres in the city. This morning’s announcement designates the whole of New Zealand as an 'availability zone”, suggesting data centre use has got to a critical tipping point in this country, where the needs of generative AI and other sophisticated applications require more horse power.

But in other respects, it is not new money being pledged, nor new jobs being created. Nor even new data centres being built.

In answer to a question about the tech giants Luxon enthused about the investment.

“This is a really great day because it’s a culmination of the $7.5 billion investment that’s gone live today, it will actually lead to 1000 jobs and actually power up our GDP by $10.8 billion,” he said.

He said the jobs AWS brought to New Zealand through training Kiwis were “really high paying jobs”. There was also a flow-on effect.

“I’ve met a number of small New Zealand firms now that have got access to world class cloud storage. That means they’ve got security around their data, which means they can now go get the customers they previously wouldn’t have been able to access, because AWS comes with a standard around security that actually helps those businesses grow their own companies.”

Luxon said New Zealand was well-positioned with the amount of renewable energy the country produced.

“AWS has powered this through partnership with Mercury, with renewable energy from their wind farm.”

The company has bought the right to draw down 51 megawatts of electricity from the power grid from Mercury Energy to power the data centres. The 15-year power deal will allow Amazon’s cloud computing arm to consume the equivalent of about 0.5% of the country’s current total installed generating capacity.

Secret locations

Manuel Bohnet, country manager for Amazon web services in New Zealand, said the data centres were already built, and had been designed in such a way, and far enough apart, to withstand natural disasters like volcano eruption and flood disasters.

It was keeping the location of the data centres, which are live today, around Auckland secret for security reasons, Bohnet said, however there has been reporting on the establishment of a data centre in West Auckland on Fred Taylor Drive.

Amazon web services had a long-term power supply agreement with Mercury, and it would be 100% renewable. The renewable claim was queried by media, leading to Bohnet saying the power was drawn directly from the power grid.

The cost of power was included in Amazon’s $7.5b investment estimate.

Bohnet would not answer questions about how the data centres were cooled.

He stressed the need for the investment, which began several years ago, to enable the more widespread adoption of artificial intelligence in New Zealand.

Later this year, it would be introducing new AI platforms so New Zealand businesses had access to platforms already available in some other countries.

Amazon Web Services is one of the world’s largest data centre operators in the corporate space.

“AI is top of mind,” he said.

What is an availability zone?

An availability zone covers datacentres in a specific geographic region, each with independent power, cooling, and networking, connected by high-bandwidth, low-latency, “redundant fibre” - secondary fibre optic cable connections that act as a backup for primary connections, ensuring uninterrupted network connectivity by providing an alternative path for data in case the main route is damaged or fails.

A Memorandum of Understanding (MoU) announced by Amazon, where the company had promised the New Zealand Government it would train 100,000 people in New Zealand in cloud skills, was announced, without details about when it was signed. The company said it had already provided training to more than 50,000 individuals.

“As part of its commitment to contribute to the development of digital skills, AWS will hire and develop additional local personnel to operate and support the new AWS Region in New Zealand,” it said.

Graeme Muller, chief executive at NZTech said the launch of the AWS Region in New Zealand was “an exciting moment.

“This investment in digital infrastructure and Amazon’s commitment to digital skills can accelerate New Zealand technology businesses and help New Zealanders to move into highly skilled, secure, and well-paid technology jobs — which exist right across the economy, from tech companies to various sectors including agriculture, finance, retail, professional services, government, and many more,” he said.

'The new AWS Region in New Zealand will help serve the growing demand for cloud services across the country and empower organizations of all sizes to accelerate their digital transformation,' said Prasad Kalyanaraman, vice president of Infrastructure Services at AWS.

The AWS Asia Pacific (New Zealand) Region will enable customers with data residency preferences or requirements to store their content securely in New Zealand, Amazon said, and serve demand for cloud services across Asia Pacific.

However, data stored on cloud services like those are stored subject to US laws, which can allow US authorities to request access to that data, regardless of where it is stored.